Lobbyist tells Bush to hop to it, or lose global dominance

PUBLISHED : Monday, 20 February, 2006, 12:00am
UPDATED : Monday, 20 February, 2006, 12:00am

Take one of America's brightest educators, give him space to make an analogy about the state of his country's global competitiveness, and he'll invariably talk about frogs.


But don't switch off at the mention of hopping amphibians. This is not an eccentric genius talking, but someone who has the ear of the world's most powerful person, US President George W. Bush.


So pay attention to the words of William Brody, the president of the foremost and oldest research college in the US, Johns Hopkins University. 'If a frog is put in boiling water, it will immediately jump out of the tub,' Professor Brody, who has doctorates in electrical engineering and medicine, told a gathering of the Asia Society in Hong Kong last Tuesday.


'But if a frog is put in a cold pan of water, and you slowly bring up the heat, you can boil the frog to death. I'm concerned that the US is failing to recognise that we're in a tub of water that is slowly heating up and we're not taking action.'


Mr Bush has certainly taken the idea of boiling frogs to heart. On the back of extensive lobbying by Professor Brody and other leading citizens, he launched the American Competitiveness Initiative in his State of the Union address last month. If adopted by Congress, the scheme would commit US$5.9 billion next financial year to increase investment in research and development, strengthen education and encourage enterprise. Over 10 years, it would pump US$50 billion extra into research and allocate US$86 billion for research and development tax incentives.


'We know that as other countries build their economies and become more technologically advanced, America will face a new set of challenges,' Mr Bush said in an introduction to a booklet issued on February 2 explaining the programme. 'To ensure our continued leadership in the world, I am committed to building on our record of results with new investments - especially in the fields of physical sciences and engineering. Advances in these areas will generate scientific and technological discoveries for decades to come.'


Not mentioned, but at the core of the initiative, are China and India. Their rapid economic growth, coupled with the extreme intelligence and innovation of their best students, are perceived by Professor Brody and other like-minded people as being a threat to the US' global dominance.


Additionally, American students are reluctant to study subjects central to research and development - the sciences and engineering - while government and corporate backing for such efforts has declined.


For the professor, a solution lies in changing attitudes and priorities - ideals laid out in reports by the Council on Competitiveness, of which he's a member, and the National Academy of Sciences. Their recommendations were adopted by Mr Bush in his State of the Union address.


Such endorsement doesn't mean that Professor Brody and his colleagues are breathing sighs of relief. To ensure that words are turned into actions, they took out advertisements in leading newspapers last week headlined: 'Where in the world will the next big idea come from?' to highlight the need for the US to get its act together.


'People recognise that this is an opportunity to change the dynamics,' Professor Brody told the South China Morning Post. 'What our country is suffering from right now is the accumulative effect of a number of deficits - the budget deficit, Medicare deficit, the impact of being in Iraq - so there are tough choices now as to how these things get implemented.'


China and India have distinct advantages in that sheer numbers mean they will have a higher proportion of outstanding students and their career focuses are more realistic.


But education standards are also different; US high school students scored the lowest in maths and science subjects in standardised testing of the 28 most developed countries. Americans also incur large debt burdens going to university, which tend to determine career choices.


'Science and engineering are not perceived as economically beneficial,' Professor Brody said. 'Students are very sensitive today to the economic return - the return on investment. In part, some are taking on debt, and in part, others look at the Wall Street hedge fund managers who are making US$100 million a year.


'This is not happening in China or India because there are not many opportunities for investment bankers, but there are a lot of jobs for engineers and those provide an upgraded standard of living from where they may have come from.'


The result was, the US was suffering when it came to innovation and creativity, he said. More than half the jobs in the nation requiring engineering or technical content are filled by immigrants and the percentage is rising because the number of relevant American college graduates is declining.


But the post-September 11 mentality, emphasising security above all else, is making filling vacancies even more difficult. 'At Johns Hopkins before September 11, we had more than 350 students from China and now it's 130,' Professor Brody said. 'That's because visas are difficult to come by and the perception is that the US is not an attractive place to come any more.'


So what if the trends continue and the US becomes a nation of investment bankers and provides just a service industry? Professor Brody believes that if this happens, trouble lies ahead.


'That's not healthy for the US,' he said emphatically.


'We need to have a more diversified economic base, which includes the ability to create things, and include some manufacturing. We'll never be the global manufacturing power that we were, but we still have the opportunity to do things where there's a high degree of creativity. It's important for the country to have that base.'


There is yet another challenge, though - one for which the creativity campaigner has no immediate solution: the quarterly profits sheet. In short, the pressure from investors for a quick return on their capital means companies are no longer willing to put money into research and development, usually a years- or decades-long process.


Although overall US investment in research and development has remained steady at about 2 per cent of gross domestic product for the past four decades, there has been a significant shift in allocation. Government spending peaked in 1965 at 1.8 per cent of GDP and is now down to 0.8 per cent, while corporations have largely shed themselves of investment in basic science, preferring to concentrate on product development.


Companies daring to buck the trend by announcing innovative research projects were rewarded with an instant decline in their share price, Professor Brody said. This left only a handful of dedicated scientists with vision to fill the void.


There is one more factor to be considered, perhaps the biggest of all: the likelihood of China and India each day capitalising on the ever-growing number of opportunities being missed by the US.